A former IRA hunger striker-turned-property tycoon has avoided going back behind bars after successfully overturning a contempt of court judgment in the Irish Republic.

Thomas McFeely - an ex-billionaire who was on Monday declared bankrupt in Dublin - has successfully appealed against a judgment that he broke court orders, a three-month sentence and a one million euro (£781,500) fine. The ruling was delivered in Ireland's highest court, by the five-judge Supreme Court.

McFeely, who served 12 years in the Maze Prison for shooting an RUC officer in Londonderry, spent 53 days without food during the 1980 hunger strikes.

The latest case centres on McFeely's Priory Hall development in Donaghmede, north Dublin. About 300 people were left homeless and had to be rehoused when they were evacuated from the complex last October amid warnings it was a fire hazard. The developer was ordered by the High Court in Dublin to carry out remedial works, but was sentenced and fined when he did not.

Barristers for McFeely appealed it was impossible for their client to comply with orders because he had been evicted from the site.

The Chief Justice, Mrs Susan Denham, said once the appellant was ordered off the site it immediately became impossible for McFeely to complete the work he had undertaken to do so.

The judge said: "This appeal does not relate to the issue of providing a remedy for the deeply concerning situation which has arisen in relation to Priory Hall, and the position of the residents and owners who have been removed from their homes. This appeal relates solely to the issue of a finding of a contempt of court.

Priory Hall residents had expected the developer to be arrested at the Four Courts after a bench warrant was issued for his arrest after he failed to comply with an order to pay instalments on a debt of just over 24,000 euro to a Dublin recruitment company.

Instead, McFeely scuffled with journalists and photographers as he left, before slamming the door of a waiting car which sped off. Separately, his family are due to be evicted from their multi-million euro upmarket Ailesbury Road home after it was repossessed by NAMA.

Resident Graham Usher said homeowners and tenants were still in limbo and extremely disappointed with the decision. He called for criminal charges to be brought against the developer after a judge ordered the Director of Public Prosecutions to examine the case.